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Chairperson;
The Honourable Minister for Local Government and Regions, Nick Raynsford;
Distinguished Guests;
Ladies and Gentlemen:

1. Introduction

During those years when the Southern African region was a scene of intense liberation struggles, many men and women of goodwill who occupied other parts of our common globe refused to stand aside. If today the region has been transformed into another zone of freedom, it is in great measure because a great many of you walked along with us as we tried to steer our way through the perilous infinities of those times. You have the right to an expression of our thanks and appreciation.

The accomplishment of freedom and independence could be no more than a prologue. We have built only a doorway and our obligation today is to look forward through it.

As we conceptualise trajectories through our new terrain, what crystallises is an even more daunting challenge: the challenge to find sustainable ways by which to improve the collective condition of life of our region's people. Battling to fulfil the needs of our people is an objective which requires a coalition of forces in government, in the private sector and in the non-governmental sector, working in a sustained partnership.

2. Global Issues

The region's heterogeneous political systems notwithstanding, many in our region are busy trying to build institutions that influence governance, service delivery and growth. We are determined to win through to a time when poverty and under-development are footnotes in history books and not the stark realities they still are in our towns, cities and rural areas. We are sounding this purposeful note at a time when the aftermath of the events of September 11 have contrived a world outlook, which is not very bright. When the prospects of a massive global economic recession are real and when some regions in the world are flirting with the danger of war.

But it is also a time when real progress has been made along the path towards mobilising the political will internationally to rebuild Africa and to sow the seeds of African renaissance so that the continent, the cradle of human kind, finally moves from the periphery of the world economy. When a peaceful solution in Burundi presents itself as a beacon of what is possible in other countries where war has become the norm, peace a dream, and poverty the daily fare for millions.

We all understand that the struggle to transform Southern Africa and Africa is situated within a context of a global interplay of complex forces. It takes place at a time when globalisation has become a key ideological catchword that has replaced the notion of the Cold War as an organising principle in international life. There are many who see the end of the Cold War as the triumph of freedom, self-determination and liberty over the forces of authoritarianism. Others would look at the same phenomenon of globalisation from an altogether different perspective. At the heart of these divergent appraisals is the contrast between the relative affluence of the developed parts of the globe and the abject poverty, which is in evidence in the developing world, which is home to about 80% of the world's population.

Looking at South Africa seven years after the 1994 democratic breakthrough, we think we have in some ways thrived and grown beyond our wildest hopes. Despite the persistence of such problems as intolerably high levels of crime, unemployment and poverty, we have succeeded to make significant strides towards universalising access to services such as water and electricity. Overall, we have moved the country from fragility to political stability. In that sense, we have achieved transformations which are more profound than those achieved anywhere in any period of comparable brevity.

3. Intergovernmental Relations

As you may know, multi-sector partnership in governance is the basic building block of the South African constitutional state and the principle instrument for socio-economic transformation within our body politic. The institutional accommodation of this principle has meant shifting the practice of political transformation from government to governance.

The principle of partnership is not uniquely South African. Professor Clarke of the University of Birmingham has noted that "governance is increasingly understood as interpreting the role of the state to be one of co-ordinating and steering an intricate network of agencies and organisations, some of whom lie in what we have conventionally seen as the public sector, some in the voluntary/ community/ NGO sector and some in the private sector. If the 20th century was the century of government with an emphasis on institutions and instruments for collective action exerting control over most of our societies, the 21st century is about governance - emphasising the processes through which societies and communities steer themselves."

What is unique to South Africa is that partnership in governance is constitutionally enshrined as the basic norm for the conduct and practice of state institutions, which we call co-operative government, and the blueprint for our system of developmental local governance that blends direct and participatory systems of democracy at the level of municipal planning, resource allocation and decision-making. In respect of the latter, partnership provides a political and a legal basis for local communities to, in the words of Professor Clarke, steer themselves.

4. Assessing Developmental Local Government

Our system of local government is at its formative stage of development having been integrated on 5 December last year. At the end of this year, all three spheres (national, provincial and local) of government will take stock of the system. The purpose of the assessment, which we think will become a permanent feature of state practice, will be to see how well we are doing in meeting the objectives of our policy on local government, to assess the impact of funding and capacity constraints on the delivery of services at local level and then to determine the shape of further interventions that may be required. We will also reflect on our initiatives to target budgets and resources to the development needs of our rural areas and towns as identified in municipal integrated development plans.

The 2000 local government elections introduced the political, administrative and institutional machinery to deliver basic services at the municipal level of government, and to enable local economic development through community participation in local budgeting and planning. The election also introduced the formation of partnerships for investment in local infrastructure and economic enterprise. The geographic map of the country would see the demarcation of South Africa into 284 municipalities in three categories: 6 metropolitan municipalities, 47 district municipalities comprising 232 local municipalities. Each province has anywhere from two to nine district municipalities, in some cases a municipality is dissected by a provincial boundary, requiring a model of joint administration by neighbouring provinces. One of the central features of developmental local government is the principle of 'one city/town one tax base' whose purpose is to bring racially fragmented tax bases under the taxing power of the municipal council.

All our councillors and municipal managers have been engaged in the processes of establishing new administrations to match the new areas of municipal jurisdiction that were demarcated last year. This process includes the finalisation of Council political structures and decision-making processes, the allocation of powers and functions, the appointment of staff, and the stabilisation of revenue collection and financial management systems. All municipalities are currently engaged in a process to plan their strategic development priorities for the next five years, a process that will be concluded in March 2002.

The reorganisation of 843 local authorities into 284 newly demarcated structures was not without complications however. Many of the newly established district municipalities lacked the basic administrative infrastructure and staff needed to carry out even the most rudimentary planning functions, and had little in the way of an adequate revenue base with which to invest in local economic development.

One of our main short-term challenges, therefore, is to ensure that all municipalities are adequately funded from the portion of nationally raised revenue that is transferred to local government from central government. A second challenge is to ensure that grant funding for municipal infrastructure, transferred from central government, is more effectively targeted to poor communities.

5. Anti-Poverty Strategy

Government has a clear anti-poverty program that rests on five pillars:
* Macro-economic stability;
* Meeting basic needs;
* Providing social safety nets;
* Developing human resources; and
* Job creation.

The Integrated Rural Development Program and an Urban Renewal Program, which seek to attack rural and urban poverty and underdevelopment, were adopted in February 2001 as part of the Government's broader anti-poverty campaign. The vision of the Integrated Rural Development Program (IRDP) is "to attain socially cohesive, resilient and stable rural communities with viable institutions, sustainable economies and universal access to social amenities, able to attract and retain skilled and knowledgeable people, who are equipped to contribute to growth and development." Thirteen of the poorest areas in rural South Africa and eight similarly impoverished urban areas are designated as development nodes for the purposes of these two programs. Within these nodes, all three spheres of government and every service delivery agency are working together in partnership so as to maximise the impact of their budgetary and resource expenditure in meeting the needs of these communities.

In October this year, the Ministry for Provincial and Local Government hosted a Local Economic Development Trade Fair. It was encouraging for all to see the innovative approaches to job creation and economic development that have taken root beyond the formal economy, in some of the most marginalised sectors of our country. Our local economic development program targets the poor for productive employment. Our successes in this include the establishment of micro manufacturing centres, a maize production and processing plant, agricultural projects that include the development of irrigation infrastructure and the diversification of agricultural activities, cultural craft centres, piggery and poultry projects, the construction of fruit processing plants and more. These projects all demonstrate a wide variety of partnerships, with municipalities playing a central role - municipal community partnerships, public private partnerships and public partnerships. The positive result of these anti-poverty programs that target the poor is reflected in the recently issued statistics in Statistics SA's household survey showing improvements from 1995-1999 in housing and access to clean water, electricity, phones, healthcare and formal education.

6. Networking Our Cities

As we understand it, cities are increasingly becoming important nodes of international finance and labour markets. Capital and labour are attracted to cities that are well managed and that perform well. In addition, the major metropolitan areas and large cities play a pre-eminent role in terms of national economic development.

Accordingly, as part of our overall local government support programme, we are in the process of establishing a 'City Support and Learning Network'. The objectives of this network, which has begun to link our nine largest cities to each other and to relevant national and provincial government departments, are threefold:

* To assess the experience of South African metropolitan areas, and to disseminate and apply the knowledge gained;
* To analyse strategic challenges facing our large cities, in particular, changes in the global economy, and to assist our cities to become more competitive;
* To create a partnership between different spheres of government in South Africa to support good governance and management in our cities.

It is intended that the network will utilise a number of different methodologies to achieve its objectives. These include:

* A programme of activity-based information sharing and learning between the cities, focusing on best practice in a South African context;
* A specific focus on inter-sectoral and intergovernmental co-ordination to improve our urban development strategies;
* Monitoring of city performance through the utilisation of a City Development Index that can be benchmarked internationally;
* A specific and appropriate performance support programme;
* A joint city research programme;
* A leadership development programme, aimed at councillors (members) and officials (officers); and
* Regional and international networking with other large cities and networks of cities.

We will be drawing on existing linkages between cities in South Africa and the UK, for example, the partnership between Johannesburg and Birmingham, as well as with institutions such as your Improvement and Development Agency (IDEA) and the University of Warwick Local Authorities Research Consortium.

We would welcome additional interaction between our Cities Network and your large cities, particularly on how your cities have had to rethink and adapt their role within a changing European and global economy.

One of the major issues confronting us is to understand how the costs and benefits of globalisation are unevenly distributed, between and within both countries and cities. One of the most important roles that local government in the industrialised world can play is to assist our cities to increase their connectivity and to become more integrated into the global economy in a way that does not result in the continued marginalisation of the urban poor.

Given the apartheid legacy of spatial distortion of our cities, we are also concentrating on ways in which our cities and towns can themselves be integrated, not just in terms of physical development and a more equitable distribution of public resources, but also racially, culturally, socially and politically. There may be a number of important lessons and experiences that we can share with each other in this regard.

In October, we convened a conference on "African Cities in Change" to consider the challenges for city governance in South Africa and Africa. The conference noted the duality that exists in our cities and towns as a result of apartheid: the employed and the unemployed, the insiders and the marginalised, the wealthy and the poor, juxtaposed and yet often worlds apart. This has meant that today our towns and cities continue to be characterised by:
* Spatial fragmentation;
* Political, racial and social division;
* A heavy reliance on subsidies (particularly public transport);
* Urban sprawl and poor land use management;
* Weak land and housing markets;
* Inadequate planning for urban growth; and
* Environmental degradation.

The very essence of developmental local government is being able to confront the dual nature of our cities and towns, and to deal with the consequences of the location of the poor in dormitory townships furthest away from economic opportunities and urban infrastructure. The solutions to these problems are complex and protracted, and we must take care that our own development policies do not suffer from the same duality. Sometimes, we separate our mainstream programs of investment in economic infrastructure for the formal sector from local economic development strategies for the poor. We must take care that when we strive to make cities globally competitive to attract foreign direct investment, it is not at the expense of those engaged in the informal sector or those who live in informal settlements.

7. Conclusion - Partnerships

Developmental local government is premised on partnerships developing between all three spheres of government, communities, the private sector and labour to design and implement a range of anti-poverty and local economic measures. As all of these measures impact at local level, municipal councillors in particular will increasingly take on the role of networking interest groups, mobilising resources for investment, and facilitating multi-sector partnerships for development.

LAACTSA has shown considerable and continuing good-will towards South and Southern Africa, and moreover invested significant time, resources and expertise in supporting the development of our local political leadership. We value this partnership. We hope we can continue to count on you. Let us continue to work together in order to fortify and sustain the material basis for a better life in the Southern African region.

I thank you.

Issued by Ministry of Provincial and Local Government

2 November 2001